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Elon Musk Unveils Self-Driving Tesla
Elon Musk, CEO of Tesla, recently dismissed reports suggesting the company was scrapping plans for a $25,000 electric vehicle. Instead, he made a new commitment to investors and enthusiasts by announcing the unveiling of a self-driving Tesla on August 8.
Tesla Stock Fluctuations
The announcement came at a crucial time as Tesla’s stock had been declining following a Reuters article that hinted at the abandonment of Musk’s promised affordable electric vehicle in favor of focusing on a robotaxi. Since the beginning of the year, Tesla shares plummeted by as much as 33%, making it the worst performer in the S&P 500.
However, just an hour after the stock market closed, Musk’s news of the robotaxi uplifted Tesla’s shares in after-market trading, leading to a nearly 5% increase on Monday. Musk has a history of promising groundbreaking technologies and new vehicles, with delayed introductions to the market, such as the Cybertruck electric pickup and the second-generation Roadster sports car.
Robotaxi Technology
Musk has long been advocating for Tesla’s electric vehicles to have the capability to operate autonomously using the company’s Full Self-Driving (FSD) software. Despite upgrades from the beta stage, Tesla emphasizes that drivers should not become overly reliant on the technology, as the cars are not fully autonomous. A recent safety assessment conducted by a national auto safety organization highlighted deficiencies in Tesla’s prior software version.
Deutsche Bank analysts caution that the imminent unveiling of the robotaxi on August 8 does not imply that the technology is ready for mass deployment. Existing companies operating self-driving vehicles, like Google’s Waymo and Mobileye, confine their operations to specific regions. Cruise, a subsidiary of General Motors, is endeavoring to reestablish its presence in the market, particularly in Texas.
Regulatory Approval and Future Prospects
Musk previously stated that obtaining regulatory approval for autonomous vehicles would necessitate accumulating 6 billion miles of FSD data. Tesla recently announced that it crossed the milestone of 1 billion miles driven using FSD, indicating progress in the technology’s development.
To bolster customer adoption, Tesla reduced the price of FSD from $15,000 to $12,000 in September 2023. However, analysts like Gary Black stress the importance of Tesla demonstrating a high level of safety assurance and liability readiness to regulators before unveiling the robotaxi on August 8.
Investors are eagerly awaiting Tesla’s first-quarter earnings report on April 23, hoping to gain further insights into Musk’s robotaxi plans and the anticipated $25,000 electric vehicle.
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